With its state-of-the-art robotics, Magal Engineering’s factory in the colorless outskirts of this busy commercial town west of London is an important component of Britain’s booming car industry, churning out millions of sophisticated vehicle parts every year.
Yet as Britain prepares to leave the European Union, Magal is having to rethink its operations here.
The company has sister factories in France and Germany, imports components from them to assemble in Reading, and sends many finished products back across the English Channel — all with minimal paperwork and no tariffs.
Britain’s departure from the European Union could change all that, ending the tariff-free trade that Magal enjoys, potentially disrupting the hiring of crucial engineers from abroad and requiring new hires to keep up with the added paperwork.
Britain’s exit is a “big worry” and ideally would be stopped, says Gamil Magal, Magal Engineering’s chief executive. But as a realist, he is preparing to live with it. That means suspending investment in Britain and contemplating production cuts here, even as the company continues to put money into France.
With Britain, the policy is “wait and see,” Mr. Magal said, speaking in his office above this bustling factory in a building that once produced World War II aircraft.
Although Britain’s economy has so far not suffered the economic blowback that many predicted would follow the vote in a referendum last year to quit the bloc, British companies that import or export goods and services are anxiously assessing the potential costs of departure.(read article)
